Archive for category MLS

The owners agreed to give in to some cash demands and increased player movement flexibility. The players agreed to keep the league organized as a single entity and let go of their hopes for free agency. The current Collective Bargaining Agreement will last for five years.

I for one am excited to see that soccer will continue, as a strike certainly would have harmed the fragile sport.

Several sources are reporting that a severe disagreement regarding league structure means that Major League Soccer (MLS) could face a strike. In order to understand the strike, we need to look at what is meant by league structure.

Image by SGFsoccer.com

The issue with the MLS structure can be explained fairly simply. Most people who follow sports have heard mention of the word franchise, as in, the “LA Lakers Basketball Franchise”. This is because the four major professional sports leagues in North America (NFL, MLB, NBA and NHL) are “closed corporations” limited to a fixed number of teams, known as “franchises“. With a few exceptions, these franchises enjoy geographical monopolies in major cities. Once an owner has control of a franchise he has the power within the framework of league rules, collectively agreed upon by the respective players union and the owners, to improve his franchise however he sees fit.

But the MLS is structured differently. The MLS is technically not an association of franchises but a single business entity. Though each team has an owner-operator, the team owners are actually shareholders in the league. The league, not the individual teams, contracts with the players.

With the structure defined, let’s look at both sides of this argument to show why it is causing a “strike-sized” disagreement.

The Players Side

The players union believes that the current structure limits the players ability to negotiate a new contract due to the lack of competing teams vying for the player’s services. The players can only negotiate with the league and the league decides where the players play. This system also restricts the players ability to switch teams or even choose the team for which they would like to play. Essentially, they are signing up to be an employee of MLS instead of an employee of one of its teams, so the league has much more control over where the player will play. The system controls costs and enables the league to keep parity in the MLS, but it does so, to some degree, at the expense of the players. This system also forces many of the best young American players to compete in Europe as the money is better overseas.

The Owners Side

Major League Soccer has had good years and bad years. It is still a fairly new league and the groups and individuals who own it feel as if they have been “propping the league up” through its infancy. To be fair many of them have, especially groups like AEG who were the first major investors in the league and who at one time were the owners of six of the 10 founding franchises. Part of the way that the current owners get money back from their investment is by selling off shares in the league to new ownership groups who then take responsibility for new teams, thereby helping to grow the league. As MLS is not well established like the NBA or the NFL, a new franchise is a risky investment. So a single entity is a much more enticing concept for potential new owners, as all owners split profits from a single pot. More owners means greater financial backing and a higher chance of success for an American pro soccer league, at least that’s how the owners see it.

by nicholasjon

Neither side is entirely wrong here and both sides are passionate about their argument, so a strike seems very likely. Where it ends up, only time will tell, but it will interesting to watch this unfold either way. I’ll do my best to keep you posted on the ins and outs.